Resource Development Council


Feds underestimate economic impact of polar bear critical habitat designations

An independent economic analysis indicates the federal government may have dramatically underestimated the potential economic impact in Alaska of designating critical habitat for polar bears. The analysis, paid for by Arctic Slope Regional Corporation and the State of Alaska, estimates the designation of 187,166 square miles of critical habitat will cost hundreds of millions, perhaps billions of dollars, in added expenses for the oil industry and lost revenue to state and local governments.

The designations cover virtually all coastal areas of the North Slope, where most of Alaska’s oil production occurs. Revenues from oil production account for nearly 90 percent of the state’s unrestricted general fund revenues.

The U.S. Fish and Wildlife Service estimated minimal economic impact of $669,000 over 29 years from the designations.

The independent analysis factored in delays in the development or expansion of oil and gas projects, reductions in oil production, and added costs to construction projects in local communities. The costs associated with just one capital project, such as a sea wall, could far exceed the federal government’s projection.

“Experience shows that projects within critical habitat face additional costs, delays, and litigation, making it more difficult for Alaska to develop our economy,” said Governor Sean Parnell. “This economic analysis will help to set the record straight on what this proposal will actually cost Alaska.”

RDC, the Alaska Oil and Gas Association, and the American Petroleum Institute filed extensive comments to the Service earlier this summer urging it to exclude any area from consideration for critical habitat designation where the costs of designation, including economic impacts, outweigh the conservation or economic benefits of designation. The Service’s own economic analysis confirms that the designation will impose significant costs while producing no added conservation benefits to the polar bear. See RDC’s comments at

RDC conference set for November 17-18

RDC’s 31st Annual Conference, Alaska Resources 2011, will be held this November 17-18 at the Dena’ina Convention Center in Anchorage. The conference, which focuses on Alaska’s oil and gas, mining, fishing, tourism and timber industries, attracted over 800 attendees in 2009. For additional information and sponsorship opportunities, visit

State opposes fishery closures

The National Marine Fisheries Service has proposed closing certain Alaska mackerel and cod fisheries to protect sea lions, despite an overall increase in the Steller Sea Lion population. The State is conducting an evaluation of the federal government’s recommended fishery restrictions while pushing for an independent scientific review. The State said it is prepared to litigate the issue.

BLM closes more of NPR-A to leasing, will do new plan

The Bureau of Land Management (BLM) withdrew a large area potentially rich in oil and gas from an August 11 lease sale in the National Petroleum Reserve-Alaska (NPR-A) to protect wildlife and sensitive habitat, according to agency officials. The sale attracted only one bidder for tracts adjacent to its existing leases, a sign of industry disappointment in the offerings.

The latest in a series of withdrawals holds back about 170,000 acres south of the Teshekpuk Lake because of migratory bird and caribou habitat concerns. Through previous planning processes, 219,000 acres under the lake were withheld from leasing. In addition, some 430,000 acres north and east of the lake were deferred from leasing until 2018.

The Teshekpuk Caribou Herd has almost doubled in populationin recent years, and BLM believes that the herd’s biology justifies holding back a significant number of potential leases south of the lake so that the agency can update its understanding of the herd’s needs and land use.

Meanwhile, BLM has announced it will begin preparation of a new Integrated Activity Plan and Environmental Impact Statement for the entire NPR-A. The plan will take into account climate change and the recent listing of polar bears as an endangered species. It will supersede other planning efforts of the past 15 years.

Environmental groups want Wilderness protection for coastal areas of the energy reserve. These same areas are believed to contain much of the reserve’s estimated 10 billion barrels of oil. Public hearings will be held in September on the new planning process.

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